Kodi Box Warning & Crackdown

Piracy through set-top boxes has grown substantially over the past year to become one of the biggest threats to the industry.  While the general public may not yet be aware of these devices that are being sold pre-loaded with software to stream pirated content from infringing sites, on April 26, 2017 the European Court of Justice (ECJ) decided that streaming via Kodi boxes are a violation of rightsholders’ exclusive right to communicate their content to the public under European Law. Streaming pirated copies of movies and TV shows has always been a legal grey area in the EU due to a loophole, unlike downloading which has always constituted copyright infringement. 

Kodi is a neutral open-source media player that can be installed on a wide range of devices, including Amazon Fire TV Sticks and set-top boxes.  And while the Kodi software is legal, some third party developers have created add-ons for the software which provide access to premium channels and allows uploading, sharing, and streaming of copyrighted content for free (films, TV series and major sporting events). The streaming loophole empowered individuals and companies who sold set-top boxes to easily facilitate and profit from piracy via streaming.

Following the ECJ decision, the UK Intellectual Property Office (IPO) released a report showing the halt to progress and the surge of illicitly adapted set top boxes, like Kodi, have had. It has caused a major shift in the threat landscape from traditional web-based piracy with reports showing that 26 mil of the 38 mil active Kodi users worldwide are using the piracy add-ons. According to the Online Copyright Infringement (OCI) Tracker, commissioned by the (IPO), legitimate streaming choices seemed to stabilize piracy to approximately 15% of UK internet users (7 mil people) who either stream or download material that infringes copyright.  But now 13% of these online infringers are using new technology, such as streaming boxes that can be easily adapted to stream illicit content – having a counter-effect on anti-piracy progress.

The fully loaded Kodi boxes were widely and publically available for sale on reputable e-commerce platforms sites such as Amazon, eBay and Facebook, as well as on highly legitimate-looking third-party sites. Since April, however, Protection Rights Entertainment Industry Netherlands (Stichting Brein), the local anti-piracy organization, has reported that at least 200 individuals and companies selling the boxes have been shut down for copyright infringement, and all three sites where the players were being sold have obliged by banning the sale of items that enable copyright infringement in all countries. According to Stichting Brein, if a seller refuses to comply, “willful infringement is assumed and this means no more warnings.” If a settlement is not reached, the case will likely go to court. In the UK, local officials have also stepped up enforcement with investigations and raids of notorious sellers.

According to Keiron Sharp, CEO of anti-piracy group UK Federation Against Copyright Theft (FACT) commented, “The reason for the change to 10 years was to go after those people who are providing, producing, importing, making available on a very high scale – committing serious crime…They can now be given a serious sentence to reflect that crime, and that wasn’t the case before.”  FACT also is suggesting that Kodi Boxes have become an epidemic and that in the near future, Kodi box users – as opposed to only those who create and sell pre-loaded devices -- could also face legal action. 

The use of these devices is also exposing the public to the serious risk of potential hacker and malware harm. It has been revealed that many of these players contain files that give hackers full control of the device leaving users vulnerable to possible DDos attacks and stolen information. 

IFTA is closely following all developments relating to Kodi Boxes in Europe, as well as the U.S. where the players also pose an enormous threat, yet legislative action has yet to be filed.